How to Create a Realistic Budget for your Remodel
You’ve certainly heard horror stories from people whose remodels ended up costing them way more than they budgeted for. There’s a pretty simple way to ensure that doesn’t happen to you, by adhering to the following advice:
- Figure out how much you want to spend and stick to that amount. Keeping in mind that the average cost of an upscale kitchen remodel is anywhere from $75,000-$100,000, consider 1) how much you can afford to spend, 2) how long you plan to stay in your home and 3) whether your neighborhood is modest or upscale. If you plan to sell within 5 years, consider the remodel as an improvement on your real estate investment; if your tenancy will be more long term, ensure the remodel makes you and your family the most comfortable. Most importantly, don’t over-improve, or you’ll lose money on what is normally a great investment when you sell your home.
- Understand how costs break down. By knowing how much of your budget is taken up by various remodel components, you can figure out where to cut if money gets tight. On average, cabinets will make up 35% of your budget, followed by labor (20%), appliances (20%), windows (10%), fixtures (5%), fittings (3%) and the all-important other (7%).
- Don’t discount the value of planning. Every hour you spend planning will save you 3-4 hours in execution. And, that includes planning financially for the unexpected. Even the most experienced contractor can’t know what challenges might be uncovered before your remodel begins – like walls with dry rot or corroded plumbing – especially if your home is on the older side. Giving yourself a 20% “cushion” means those unforeseen issues won’t bust your budget.
- Set your priorities. Make a list that includes “musts,” “nice to haves” and “willing to forego.” That will make it easier to make decisions if money becomes an issue.
- Factor in “non-remodel” costs. Certainly include the cost of eating out if your kitchen won’t be available to you during the remodel. If you choose to leave your home entirely while work is occurring, your cost to stay elsewhere also needs to be factored in.
- Nix extras. Don’t be tempted to deviate from your budget in the middle of the project. As noted in the first point, stick to the amount you originally budgeted, or face the financial consequences of adding extras mid-project.
Creating a realistic budget probably isn’t the only question you have with regard to moving forward with a kitchen remodel. You may wonder:
Is it time to remodel your kitchen?
When should you hire a professional, and why?
Overcoming your objections to European cabinetry.